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When French and Dutch voters were given an opportunity to vote
for the European constitution in 2005, which would have
transferred considerable sovereignty from their countries to the
European government and its unelected bureaucrats, they
“unexpectedly” killed it.

They wanted to hang on to their sovereignty. An unforgettable
lesson for European politicians: don’t let the riffraff decide.
Such matters are best handled by the elite—politicians, bankers,
and unelected bureaucrats. And on Wednesday, they were busy
handling such matters.

In the morning, Andreas Voßkuhle, President of the German
Constitutional Court, announced that two of the main Eurozone
survival strategies, the ESM bailout fund and the Fiscal Union
treaty, would “most likely” not violate the constitution
(press release, flash analysis).

By rejecting the plaintiffs’ efforts to block the laws, the Court
allowed Federal President Joachim Gauck to sign them; and they’d
become binding international treaties.

Thus, the Court nodded with a stern smile on the transfer of
sovereignty from parliament to unelected bureaucrats within the
European Union government. For the fifth time—after waving
through the EFSF bailout fund in 2011, the Lisbon Treaty in 2009,
the introduction of the euro in 1998, and the Maastricht treaty
in 1993.

Each time, it added conditions that gave plaintiffs a pretext to
proclaim victory and try again next time. True to form, Peter
Gauweiler (CSU), one of the most vocal plaintiffs, called the
decision a “giant success“ and “legal sensation”; the
conditions would make it more difficult to turn “the ESM into a
bottomless barrel,” he said.

Chancellor Angela Merkel slapped herself on the back,
complemented the justices—”The Court goes the way that also
guided me,” she said—thanked those who’d supported her,
including the opposition SPD and Greens, and told the rest of the
world that Germany was carrying its share of the load. Alas, in a
poll last week, 54% of those who’d be carrying
that load wanted the Court to stop the ESM and Fiscal Union
treaty. Only 25% wanted the Court to wave them through.

And then the noose tightened further on national sovereignty in
Europe, and particularly in the Eurozone. Michel Barnier,
European Commissioner for Internal Markets and Services, hammered home his plan to create a
supranational banking supervisor with a bank bailout fund and a
deposit insurance fund, under the ECB. It would not only cover
the 25-30 systemically important Eurozone banks, the TBTF banks
that could take down the world, or worse, presumably, but
all 6,000 Eurozone banks, down to small savings banks. A
centralized banking supervision would have to have the right to
act “in any imaginable situation and in any bank,” he said,
citing non-systemically important banks that had collapsed:
Northern Rock, Bankia, and Dexia [read.... Belgians Get Cold Feet As Bailout Queen Dexia
Drags Them Toward The Abyss].

The power grab hit resistance in Germany. Finance Minister
Wolfgang Schäuble only wants to put TBTF banks under centralized
control. The Bundesbank, citing conflicts of interest, doesn’t
think the ECB should become the regulator of banks it funds. And
the Association of Savings Banks came out against allowing the
ECB to supervise savings banks. It would use their contributions
to prop up banks in debt-sinner countries and through that
transfer make savings banks less secure. Also, tottering banks
could go directly to the ECB to get their bailout funds, rather
than the ESM, with all its irksome conditions and parliamentary
votes. But resistance will be whittled down over time. And in the
end, it won’t change the principle that bankers regulate bankers
for the benefit of bankers.

Unelected European Commission President José Manuel Barroso
chimed in with his state of the union speech to the European
Parliament—not only calling for a centralized banking supervisory
and bailout mechanism, but for a “quantum leap” in every other
aspect of centralizing governance in Europe to form a “federation
of nation states.” His grandiose plans weren’t just for the
17-member Eurozone but for the 27-member European Union, which
includes the UK, whose people have been, how shall we say,
reluctant to hand over sovereignty to European bureaucrats.

The European Commission would doctor up the plans, in
coordination with European Council President Herman Van Rompuy, another unelected
honcho, and would present it to the European Parliament, an
emasculated institution that cannot do what other parliaments can
do, namely initiate legislation; it can only vote on legislation
initiated by the Commission or the Council.

But there would be more democracy, Barroso promised, including an
elected president. An incentive for all politicians in Europe to
go along with the power grab. It would give them a higher level
of government to move up to, one with more power. They all must
be thinking about it, Merkel, Schäuble, French President François
Hollande, Nicolas Sarkozy.... Well, on second
thought, maybe not him.

The media are falling all over themselves to celebrate the German
Constitutional Court's acquiescence to the ESM and the Fiscal
Pact; the building blocks are now in place for the establishment
of a "Federation of European States," European Commission
President Barroso’s pipedream. The Euro debt crisis is
finally resolved. But did the justices really give up the ghost?
Read.... The German Constitutional Court Torpedoes The
ECB’s OMT, by Blankfiend.